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ELTO and ERN - have you been asked yet?

Thu, 17 May 2012 21:29:00 +0100

What a strange title! Well, the good news is that this piece only relates to business insurance that includes Employers Liability Insurance(EL). If your business has employees, you should know that EL Insurance is one of the few compulsory insurances. Your next insurance renewal will not happen unless you can supply your ERN to insurers.

What is ERN? This is your Employer Reference Number - usually found on your company taxation documents. Why do insurers want it? This is part of an effort to be able, in the future, to capture the insurance history of all employees.

The Employers Liability Tracing Office (ELTO) will accumulate all of this data. Hopefully, at some time in the future, when a worker contracts a serious illness, the ELTO database will be able to identify the insurer(s) that were most likely to have issued the EL Insurance policy relevant to the period of work when the illness was first contracted. This might make the process of assessing liability easier than it is at present.

The situation to date has been very difficult. When a person contracts e.g. mesothelioma (asbestos related cancer) they will be asked for their work history. Hopefully a combination of their memory and some paperwork may be able to establish some facts. It is then necessary to try and pinpoint the appropriate insurer - very difficult when 20 - 50 years of mergers, acquisitions and failures have dramatically changed the insurance landscape.

So, if your broker asks for your ERN, please give the information; your renewal process will be smoothed and your employees will be happy.

Fed up with increasing motoring costs?

Thu, 10 May 2012 06:44:00 +0100

Do you use your car every day? Does it sit on your drive looking unloved and underused? How about hiring it to your neighbours?

If you are horrified by this thought, take a look at www.whipcar.com. The neat thing about this scheme (from our point of view) is that Whipcar provides the insurance for the duration of the hire. This protects your insurance and gives you some welcome additional insurance.

Do not be tempted to try this by yourself...you could damage your insurance very easily. Also, do you want to trust the hirer's insurance and their statements about how good their driving has been over many years?

The consequences of flooding

Mon, 07 May 2012 10:56:00 +0100

We are all accustomed to the sight on television of homes under water after torrential rain. Just this week, the now traditional views have appeared of Tewkesbury Abbey surrounded by water. For the unfortunate property owners in that area, they not only have the problem of the regular clean-up; there is now the very real probability of not being able to buy flood insurance (or any insurance in some instances). In addition, if a property cannot be fully insured, it is also likely that the property will not be suitable for a mortgage.

In the last couple of months, there has been an increase in reports of house purchasers being unable to insure the property of their dreams. This has led to the collapse of the transaction. This problem can only increase as the government spending on flood defence decreases. A further problem relates to the 'statement of principles' that was signed by insurers back in 2000. This agreement confirmed insurer's agreement to maintaining flood insurance where it could be shown that there was ongoing flood defence improvement. The 'statement of principles' is scheduled to end in June 2013. Properties in affected areas can expect to see the withdrawl of flood insurance from renewals after June 2012.

Finally, check the flood excess on your policy. Insurers do not use one standard database and also do not agree on the appropriate level of postcode detail that is used in their environmental search. This can lead to extraordinary differences in the level of excess amongst close neighbours.

If you see anything on your policy that causes concern, feel free to email Northwood!

Lock up your sheds !!

Wed, 14 Mar 2012 07:28:00 +0000

Welcome to Spring!! The birds are singing, the buds are bursting and your local burglar is becoming restless. Analysis of theft claims over the last 10 years shows that the evenings get lighter, your shed is more likely to be a target for thieves.

If your shed is visible to passers, and if your golf clubs, power tools, mowers and so on are visible, the probability of your local thief stealing everything is sharply increased.

The average haul is £850; this takes no account of the inconvenience and trauma that follows any loss. So....be sensible. Hide your ladders and wheely bins (they make it very easy for burglars) and keep your garden valuables out of sight.

Good news for young drivers

Tue, 13 Mar 2012 07:35:00 +0000

The good news is that, in 2010, only 685 under-20s were killed or seriously injured on the road. Of course, that is 685 too many. However, the equivalent figure for 2008 was 986.

Why is this? One possibility is that the increasing cost of motoring may be a factor. In addition to the cost of petrol and insurance, adding penalty points also has increased consequences. Insurers now load their premiums for any penalty whereas, in previous years, one SP30 (for example) may have been ignored.

One recent survey shows that the average comprehensive premium for a 19-year-old male with a 10-year-old Peugeot 106 would be £2,251. Three penalty points would increase this average by £264.

There are rewards available for young and safe drivers - a good place to start is the Co-operative Insurance website.

Severe weather coming to an exposed pipe near you

Mon, 30 Jan 2012 17:43:00 +0000

It is the end of January, and if we can believe the weather people, we are heading for a period of very cold days and nights.

Do you know where all your pipes run? Are any exposed to freezing temperatures? A burst pipe in an unheated, unlagged loft can create a deluge that render a home or business premises uninhabitable for many months. Take a look around and check that everything is in good shape.

The cold weather will make all of our heating work harder; have you serviced your gas boiler recently? when discussing business prospects with a heating engineer last week, he was bemoaning the lack of business caused by too much good weather. It takes a cold snap to boost his profits. So...take action now if your system has not been serviced.

In general, take nothing for granted. Check around your home or works and apply common sense.

Business Essentials

Tue, 17 Jan 2012 07:53:00 +0000

Whatever the age and size of your business, one major worry is 'am I up to date with legislation and other rules governing business?'

In the SME sector, this is a major issue as the owner and directors (often the same person) cannot possibly know all the essential factors that define the correct and legal way to run a business. For example, the Companies Act 2006 contains a multitude of rules which must be obeyed; how can a business owner possibly know all of these rules, let alone all the other areas of importance in areas such as employment and taxation.

With this worry in mind, The Business Essentials Conference has been created. By attending, you or your associates will be able to hear experts talk on such subjects as Human Resources, Recruitment, Environment, Bribery, Pensions and Health & Safety. There will be a Q&A session at the end plus access to experts and other exhibitors throughout the day.

Interested? Keep February 29 free and take a look at www.businessessentialsconference.co.uk for more information.

Insurance does not replace commonsense

Fri, 30 Dec 2011 16:40:00 +0000

It is impossible to insure against every eventuality. Even if you could, would you really want to suffer the inconvenience of post-loss stress and the time spent in dealing with the consequences of loss? In fact, insurance is one of the few products that most people and businesses buy and yet most do not ever want to use it because of the post-loss hassle.

it is also true that fewer losses equals fairer premiums. Thus, insurance should be regarded as a financial safety net that operates only when a disaster happens even after every precaution has been taken. Insurance should not be regarded as some sort of bank that provides cash whenever something breaks.

So, what can be done to avoid having to make a claim?

A good place to start is by using your commonsense. For example, a worn electric socket often sparks when operated. Instead of waiting for it to fail permanently or maybe catch fire, why not correct the fault immediately? Or your car...why wait for an MOT test to tell you that one or more lights are not working? Replace the bulbs as soon as the failure is noticed. That way, you will be better seen in poor light and maybe avoid an otherwise inevitable accident.

Remember the basic insurance principle that you are expected to act at all times (not just at renewal!) as if you are uninsured. How would you act if there were no financial safety net? Take a look around and use your commonsense; if something starts to worry you, take action!!

Business interruption?!?

Fri, 30 Dec 2011 16:40:00 +0000

Business Interruption - what the heck does this phrase mean?

In the insurance world (this blog's main interest), it means that we have to consider the effect of a disaster on the finances of a business. This does not have to be a major event such as an earthquake; even e.g. a tiny fire in an adjoining building can cause an interruption to your activity. Or the loss of your major supplier - what would be the consequences?

It is sensible for all business owners, (yes, even one-man companies) to analyze where the specific areas of vulnerability occur. Once the analysis has been completed, can these be eliminated, reduced or otherwise accepted? Such a review should be undertaken at regular intervals to accommodate changes in the business environment. This process is known in the insurance industry as Business Continuity Management, i.e. the business owner is managing the process of keeping the company going without any interruption.

Going back to the loss of a supplier - in early 2011, Vodaphone's mobile network was switched off following theft of equipment at their Basingstoke exchange. Does your business depend on 24/7 access via your mobile phone? If it does, would you have managed with your system being unavailable for a long period? These are the types of question that business owners need to ask of themselves.

Risk Managament is the process of evaluating such threats. Insurance is one excellent element of risk management but far better to prevent the loss happening in the first place

Falling mirrors - even the best prepared can suffer

Wed, 07 Dec 2011 10:37:00 +0000

Marks & Spencer are one of the best companies around when it comes to customer care and health & safety in general. You can imagine management's feelings when, after all the trouble they had taken, a mirror decided to fall off a wall. Admittedly, a young person was leaning on it; no excuses - mirrors should not fall off walls. The young person was severely injured by the breaking glass.

This happened early in 2011. M & S were said to be investigating. You can be certain that mirrors in all M & S stores are now so firmly fixed to the walls that the maintenance staff have problems when it comes to redecoration

So, even the best run organisations can suffer. Are your health and safety arrangements at the same high standards as M & S? Are you confident that your risk management in general is as good as it can be? Call Northwood Risk Management for a chat if you are nervous!

Business continuity and cloud computing

Tue, 06 Dec 2011 16:21:00 +0000

Cloud computing is a well-known phrase that describes a (apparently easy and risk free) new way of storing data by using equipment belonging to others. The basic feature of this is that your data leaves your control and is stored on servers belonging to third parties.

There are numerous benefits to cloud computing. However, there are many downsides as well. The latter do not make cloud computing a bad thing but it does mean that the potential risks have to be analysed and understood.

There is a brilliant piece which talks in more detail and which will save space in this blog. It is written by Jim Symington of Chiltern Business Computing. Northwood Risk Management is delighted to provide a link so that the full piece can be accessed

www.chilternbusinesscomputing.co.uk%2fguides%2fcloud-computing.htm

Be prepared - it could just happen

Thu, 03 Nov 2011 09:47:00 +0000

In 2010, Mike Edwards (a founder member of the famous group ELO) was driving his van through the Devon countryside totally unaware that a round hay bale was careering downhill towards him. Seconds later, he was dead. The bale had landed on the roof of the van, crushing it and him in the process. The bale weighed (as they all do presumably) roughly 280KG. Mike Edwards suffered numerous injuries and died as a result.

The owner of the farm and the baling contractor have waited one year and, in Autumn 2011, were facing various charges under the Health & Safety (Offences) Act 2008.

http://mashed08.backnetwork.com/feeds/post.aspx?postid=782 will give you more detail.

Before you consider cancelling your business insurance in order to save money, just consider whether you could say 'I have never had a claim so I never will'. The lesson of Mike Edwards is 'never say never'

Material Facts

Thu, 27 Oct 2011 16:30:00 +0100

If you are offering an insurance company some business, it is essential that you tell the insurer all the relevant facts. This will enable the insurer to quote the correct premium. This does not mean that the premium will be one that you will like but it does mean that the premium will meet their criteria bearing in mind their portfolio requirements.

Holding back an essential fact is a potential fraud. This can have serious consequences.

The general rule is that it is best to give too much information. The insurer can then decide what is relevant.

There is a regular problem with the exact phrasing of the questions that the insurer gives you. For example, for motor insurance compare...(a) Have you made a claim on your motor insurance in the last 3 years against....(b) have you ever made a claim or suffered an incident that may have led to a claim? A massive difference between the two. We have seen similar extremes on forms for private medical insurance and travel insurance. If type of question is causing you a problem, call Northwood!

Is your car insured?

Thu, 27 Oct 2011 07:48:00 +0100

The Metropolitan Police have announced that they will be celebrating Autumn 2011 with an energetic campaign to remove uninsured vehicles from London's roads. If this is successful, it can be assumed that other police forces throughout the UK will take the same action.

The linkage of all the various official motor databases (DVLA and Insurers) make this task very easy for the police - it takes seconds to establish that a vehicle is uninsured. Such a vehicle will then be removed and, after a few days, either sold at auction or crushed. The owner's bank account will also suffer.

If you do not want to suffer such an indignity, make certain that all your car's paperwork is in order - road tax, MOT, insurance or, if appropriate, S.O.R.N.

Uninsured Drivers

Tue, 25 Jan 2011 12:27:00 +0000

Anyone who owns an uninsured vehicle will be traced and become potentially liable to pay a fine....or worse!

The database of the Motor Insurers (MID) is to be linked to that of the DVLA. This will enable enforcement officers to detect any uninsured vehicle, whether it is being driven or simply parked.

Under the new system, the owner/keeper of the vehicle will receive a letter telling them that the vehicle appears to be uninsured. Action will be demanded; if this demand is ignored then a fine will follow and the vehicle will be removed and destroyed. The authorities are promising no mercy - the campaign to eliminate uninsured driving is becoming ever stronger.

Why is this? Statistics show that uninsured motoring is a big problem. Some of the consequences include accidents causing 23,000 injuries and 160 deaths each year. Apart from the social cost, the monetary effect is to add £30 to every motor insurance premium. Each year, around 242,000 offenders are convicted for uninsured driving; expect this number to rise!

More details on this will come from the authorities soon. The enhanced scheme comes into force in Spring 2011

False information leads to fraud convictions

Thu, 20 Jan 2011 06:36:00 +0000

A recent press release from The Association of British Insurers (ABI) has reported on a recent YouGov poll of drivers. Apparently, around 53% of those quizzed think it acceptable to be less than truthful when completing their insurance proposal.

Fronting is a common trick. Fronting is where, for example, a parent buys an insurance in their name, adds a child as a named driver even though the younger driver is the main user. This is a device that is used to reduce premiums but the lie is a fraud.

Another common trick is to be economical with the truth with the claim history. Beware of motor insurance application forms, whether paper or online. There are no standard questions. You might be asked ''have you had any claims in the last 3 years''......or, you may be asked ''have you ever had an incident which led to a claim, or which might have led to a claim''. There is a massive difference between these two extremes and a wrong answer could lead to unfortunate consequences.

Consequences? As noted in the ABI press release, these could include, at the very least, failure to pay the claim, then inability to buy insurance in the future. Worse, and because the false information is a fraud, a criminal conviction could follow.

Best tactic - do not lie when making an insurance application AND learn to be the best driver by taking refresher courses. Take a look at The Institute of Advanced Motorists - they, for example, are one of the places where you can learn to be the best driver.

Potholes

Tue, 11 Jan 2011 12:31:00 +0000

Motor insurance premiums are showing no signs of reduction. Already in 2011, all premiums have risen because Insurance Premium Tax rose to 6% from the 5% that we have all enjoyed for several years. In addition, there will be consequences arising out of the severe Winter (so far!). AA Insurance reported yesterday that £10m (and rising) has already been paid just because of pothole damage; there will be a lot of other payments because of e.g. ice-related collisions.

Still on the subject of motor insurance, do not be tempted to leave your car running while you pop back indoors for whatever reason. Over the last weekend, a car was stolen in these exact circumstances. The owner was inside their home for less than one minute. Insurers are very unlikely to pay such claims.

Happy New Year

Tue, 04 Jan 2011 06:40:00 +0000

Happy 2011 to everyone!

We wish all our readers a loss-free year; no accidents at work....or anywhere else!

Please note that, in additon to all the bad economic news lately, The Chancellor also increased Insurance Premium Tax. This takes effect from today. You will find that nearly all of your insurance policies will now be subject to 6% IPT rather than the 5% that you enjoyed in previous years.

Maintenance

Mon, 29 Nov 2010 16:39:00 +0000

With Winter dramatically with us, it is time to check all those areas of your property that might suffer in severe weather, especially valley and other gutters, downpipes and any other place where debris can collect. Blocked pipes mean that the rain or snow could end up in the wrong place and cause lots of damage.

Remember that insurers expect their customers to look after their property and generally act as if they are uninsured. Poorly maintained property can lead to claims difficulties

The Policy Excess

Tue, 12 Oct 2010 07:35:00 +0100

Policy Excesses are a common feature of all insurances. Their purpose is to prevent the insurance companies being swamped with small claims. The policyholder pays the excess. Many policies will have a number of different excesses i.e. different amounts of money. There is also no consistency between insurers so, for example, on a commercial property insurance policy, one might find that the standard excess can be any figure in the range £100 to £500.

This difference in attitude between insurers can give rise to problems. One extreme example arose in 2009 when a pair of semi-detached houses had different Storm and Flood excesses. One had £100.....the other had £10,000!! It is true that the houses were located in a Flood zone but that still did not explain the difference. After appeal, the larger Excess was reduced to £2,500 - still a BIG difference!

Then there is Subsidence. If your property is located in a Subsidence area, you may find that the standard Excess of £1,000 has been increased to £2,000 or more. In some extreme areas, Subsidence insurance is not available at all.

There are a number of reasons for this lack of consistency. One is the actual loss experience of the insurer. Another can be the type of postcode that they are using. Some use the first 3-4 digits of the postcode, others use all digits except the last. Lastly, there are different interpretations of the data produced by the various agencies that report on rising water tables, flood defence and so on.

So, if you are located near to the top of a hill and your insurer is suggesting that you are at serious risk of Flood, it may be that their data is lacking sufficient detail. You can challenge any subsequent rise in Excess as long as you have supporting evidence.

So...the message is...always check all of your Excesses!!